When it comes to betting on political outcomes, a new bill wants to make sure lawmakers aren’t using insider knowledge to cash in. Wisconsin Representative Bryan Steil recently introduced legislation aimed at curbing exactly that. However, the proposed law is already raising eyebrows for who it explicitly leaves out of the equation: top officials residing in the White House.
What the “Stop Lawmakers from Predicting Act” Actually Does
Representative Steil, who currently chairs the House subcommittee on digital assets, introduced the “Stop Lawmakers from Predicting Act” to create clear ethical boundaries for public officials. The proposed law specifically targets members of the US Congress, alongside their spouses and dependent children. It would officially ban them from trading event contracts related to public policy issues, government actions, and political outcomes on popular prediction markets like Kalshi and Polymarket.
Interestingly, the bill doesn’t outright ban politicians from using these platforms altogether. Lawmakers would still be free to place wagers on sporting events or other non-political markets. The core focus is strictly on preventing elected officials from profiting off insider information regarding government moves or election results. If caught violating the ban, offenders would face a $2,000 fine or a penalty equaling 10% of the value of their prohibited bets. If passed by Congress and signed by the president, the rules would kick in 180 days after enactment.
This legislative push comes on the heels of a highly publicized controversy that brought prediction markets into the mainstream spotlight. Public outrage surged after reports surfaced of a soldier who allegedly netted over $400,000 by betting on the removal of Venezuelan President Nicolás Maduro, an event that was ultimately executed by US forces in January. That incident highlighted the massive ethical and security gray areas surrounding event-contract betting, prompting Congress to finally take action.
White House Exemptions and the Regulatory Tug-of-War
While the bill takes a firm stance on Capitol Hill, it notably omits any restrictions for White House officials. Under the current draft, President Donald Trump, Vice President JD Vance, and their administration staff would not be subject to the insider trading ban. This omission has drawn significant public and media attention, especially given the current administration’s close ties to the prediction market industry. Donald Trump Jr. currently serves as a strategic adviser for Kalshi and is an adviser to Polymarket. Underscoring this relationship, Polymarket was recently a sponsor for the UFC Freedom 250 event hosted at the White House.
Beyond the proposed trading bans, a massive legal battle is brewing over who actually gets to police these platforms. The Commodity Futures Trading Commission (CFTC), led by Chair Michael Selig, is fighting aggressively to maintain exclusive federal control over prediction markets. The federal agency argues that event contracts should be classified and regulated as “swaps” under the Commodity Exchange Act, rather than being treated as traditional gambling bets.
To defend this jurisdiction, the CFTC has already launched several lawsuits against state-level regulators who have tried to restrict or ban platforms operating within their borders. With tensions rising between state authorities and federal regulators over how to handle the booming popularity of political betting, many legal experts predict this high-stakes regulatory battle is on a fast track to the Supreme Court.
